In a bid to get ahead of profit losses in the wake of its split with Ye aka Kanye West, adidas intends to rebrand its Yeezy stock.
According to reports, the global athletic brand pointed to a plan of repurposing its surplus of clothing and footwear already manufactured before its severing of ties with the controversial artist last October as a way to avoid a massive financial loss estimated at $1.3 billion. The company detailed this in a profit warning issued through its website last Thursday (Feb. 9).
The move to repurpose the Yeezy stock under the adidas name may play out through a couple of options. The first would see the company sell the inventory removing the Yeezy label and selling the product at its own stores and at a discount to other retail partners.
Another option is for adidas to sell the repurposed items in smaller markets outside of the United States. “Somewhere where it’s not visible in their primary markets would be one approach they might take,” said Marshall Fisher, a professor at the Wharton School at the University of Pennsylvania.
The brand could take the drastic move of destroying the remaining stock. The risk of further damaging its reputation is higher with this move as other companies who’ve done so have come under fire in the past. “We’ve seen that happen with other luxury brands out there who didn’t want to see their product discounted at the end of the season,” said footwear expert and former collaborator Matt Powell. Donating all of the stock is also on the table, and according to Fisher, would go a long way to bolster adidas in the eyes of consumers.
Adidas is still investigating the after-effects of ending the deal with Ye after he made several antisemitic comments last October. The brand said at the time that it does not tolerate antisemitism or other forms of hate speech. Shares in the company went down 11% after the news was announced.
—
Photo: Jeremy Moeller / Getty